Botswana IFSC

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Overview. Botswana IFSC Introduction IFSC Value PropositionSpecific Tax Incentives Possible Structure - Resources Holding Co. /Corporate HQIFSC Efficacy as Capital Raising PlatformCase Study - LetshegoInternational Insurance . Botswana IFSC Introduction. A regional hub to facilitate delivery

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Botswana IFSC

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1. Botswana IFSC An Opportunity to Base Regional HQ Company in the Botswana International Financial Services Centre

2. Overview Botswana IFSC Introduction IFSC Value Proposition Specific Tax Incentives Possible Structure - Resources Holding Co. /Corporate HQ IFSC Efficacy as Capital Raising Platform Case Study - Letshego International Insurance

3. Botswana IFSC Introduction A regional hub to facilitate delivery of a wide range of cross-border financial services. Targeting companies with a growing business presence in Africa. An active financial services centre, and not positioned as tax haven. Leverage Botswana’s positioning. Substantive companies (vs brass-plate) Low not nil taxation Full exchange of information with other jurisdictions Leverage Botswana’s positioning. Substantive companies (vs brass-plate) Low not nil taxation Full exchange of information with other jurisdictions

4. Botswana IFSC Value Proposition Flexibility in driving regional expansion in Africa Proximity and provision of substantive business support functions Tax reduction on income from foreign subsidiaries Raise or accumulate capital to fund future regional expansion Exemptions from work and resident permits for expatriate employees Lower cost environment vs traditional offshore centres ( Guernsey, Jersey etc.)

5. Specific Tax Benefits of Botswana IFSC 15% Corporate Tax Rate guaranteed until 2020 Exemption from withholding taxes on interest, dividends, commercial royalties & management or consultancy fees, Access to Botswana’s Growing Double Tax Treaty network Credit for withholding taxes suffered in other jurisdictions (up to 15%) Exemption from Capital Gains Tax (CGT) IFSC companies are zero rated for VAT Easy entry or exit Benign tax 15% corporate, Max 25% individual DTA: UK, France, Sweden, South Africa, Namibia, Zambia, Mauritius, Barbados, Seychelles Awaiting Ratification: Zimbabwe, Russia Negotiated, waiting to be signed: India, Malawi, Zambia, Serbia, Under negotiation: Tanzania Strategy: SADC, European financial centres (Lux / Netherlands) CGT (Income Tax Amendment, July 1st, 2006). Easy entry or exit Benign tax 15% corporate, Max 25% individual DTA: UK, France, Sweden, South Africa, Namibia, Zambia, Mauritius, Barbados, Seychelles Awaiting Ratification: Zimbabwe, Russia Negotiated, waiting to be signed: India, Malawi, Zambia, Serbia, Under negotiation: Tanzania Strategy: SADC, European financial centres (Lux / Netherlands) CGT (Income Tax Amendment, July 1st, 2006).

6. Structure - Resources Holding Co. / Corporate HQ Opportunity for companies with growing African network to consolidate financial and admin. functions. Mining Group Holding Co. of African Mining Interests Consolidate exploration & mining businesses across Africa & provide centralized admin. & financial services. Manage finance facilities to group subsidiaries, manage group liquidity and group risk Capital raising through BSE - to fund exploration programs & develop intermediate projects Management, administrative and financial advisory services. Operating in a complex multi-country environment Activities Raised capital through IFSC vehicle Group treasury Shared administration platform for the group, including IT Botswana business model Listed on Botswana Stock Exchange Operating in a complex multi-country environment Activities Raised capital through IFSC vehicle Group treasury Shared administration platform for the group, including IT Botswana business model Listed on Botswana Stock Exchange

7. IFSC Efficacy as Capital Raising Platform Raise capital through BSE listing Dual list on TSX, AIM and AUX Botswana’s sovereign credit rating by S&P and Moodys BSE listed resources companies; A-Cap, African Copper, African Diamonds, CIC Energy, DiamonEx, Discovery Metals, IAMGOLD, LionOre

8. Case Study – Micro Provident Botswana IFSC accredited Holding company to drive expansion of short term finance business operation into Africa Botswana, Malawi, Swaziland, Tanzania, Uganda and Zambia BSE listed, market cap. P 2bln, total income P 185million, total assets P 445million(2006) Main shareholders are PAIP, PCAP, FMO, IFC and Botswana Life Insurance Limited Accounting & admin services, financial & credit control, group treasury, inter-group lending, group ICT support, dividend management

9. International Insurance International Insurance Legislation now allow for wide range of international insurance activities Captive-insurance subsidiary Co. that only underwrites parent’s group risk Bypass typical insurer & gain direct access to reinsurance market (lower group insurance premiums/insurance cost) 30- 40% cheaper than UK Value proposition not focused on cost. People Available labour (unemployed trainable youth) Good labour relations Batswana are worldly (empathetic) Activities Existing Fund administration (African Alliance) Inbound and outbound call centres (Alpha Call Centre) Financial and tourism services Feasible Salary processing Data entry and administration Website / Database management Basic accounting Insurance processing Liberalisation allowing for VOIP / ADSL 30- 40% cheaper than UK Value proposition not focused on cost. People Available labour (unemployed trainable youth) Good labour relations Batswana are worldly (empathetic) Activities Existing Fund administration (African Alliance) Inbound and outbound call centres (Alpha Call Centre) Financial and tourism services Feasible Salary processing Data entry and administration Website / Database management Basic accounting Insurance processing Liberalisation allowing for VOIP / ADSL

10. Steps to IFSC Licensing & Accreditation Registrar of companies – Company Formation Application / Business plan considered within 4-6 weeks Representative IFSC Certification Committee considers applications Bank of Botswana regulatory clearance Telecommunications Work and Residence permits

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